Busting the gaming stereotype

South Africa’s gamers are educated, healthy, well-off and live life to the full

By Rachel Thompson, insights director at GfK South Africa

Perceptions that gamers are predominantly young, geeky, and male persist, despite the reality that playing videogames has become mainstream.

Our consumer research at GfK shows that playing games today spans generations and genders. Today, most people in the mid and upper LSMs play games at least sometimes, with around 72% of internet-connected South Africans playing games across their devices at least once a month.

Our GfK Consumer Life study – surveying 1 000 South African consumers who are representative of the online population – indicates that the proliferation of smartphones and mobile devices is the catalyst for the mainstream gaming explosion. Some 54% of the respondent base are playing from mobile phones. Around a fifth (20%) own a dedicated gaming console.

The data reveals that 12% of these connected consumers own a gaming console and play games every week, while 6% play every day. Daily gamers are more likely to be members of Generation Z, but there are significant numbers of older daily gamers, too.

Regular gamers are more likely to live in high-income households and to have a good education – 30% of daily gamers are LSM 10 and 23% have a university degree. While half of regular gamers work full time, the more frequent daily gamers are more likely to be students (30%) or unemployed (20%).

The profile of the gamer is that of a person living life to the full – regular gamers are more likely than the average online South African to socialise, exercise, play sport, go to gym, and shop online. They are also more likely to stream online movies and drink alcohol. Consider that 49% of daily gamers use vitamin and mineral supplements compared to 39% of online South Africans, for example, and that 82% of daily gamers exercise to look their best (all online consumers  ̶  71%).

What’s more, 69% prefer to buy fewer higher quality items (all online consumers  ̶ 49%), 56% pamper themselves regularly (all online consumers  ̶  44%), and 72% reflect their individuality through what they buy and wear (all online consumers  ̶  48%). This no doubt reflects the fact that gamers are often from higher income households than the average and that many are students who have time on their hands. However, it does dispel the myth that they focus on their gaming hobby to the exclusion of real life.

Compared to the typical South African, gamers also have a progressive outlook on technology adoption. Some 60% of daily gamers describe themselves as “passionate about technology” and 80% planned to purchase home electronics in the next 12 months at the time they were surveyed. Compared to just 43% of all online consumers in South Africa, 65% said they had knowledge and experience of technology. They are also more likely to purchase online (85% vs 68%).

All of these stats paint a picture of the avid gamer as an adventurous person who treasures their freedom and individuality. They understand the power of tech to elevate their individualism and they are looking for products that are tailored to their personal needs.

 

Online shoppers value unique digital experiences

Online shoppers have little tolerance for ineffective or clunky purchasing experiences. Consumers expect reliable sites and easy ordering and fulfilment, in large part because of the elevated transactional experiences digital commerce leaders like Amazon, takealot.com and others have proven possible. Free shipping, shipping tracking and information about returns are the top three capabilities services online shoppers expect brands and retailers to offer.

Online shoppers seek out digital experiences that are on par with what is available from a physical retailer: zero fees for receiving a product, complete knowledge of when their purchase will arrive and access to no-fuss returns.

Now that there is an almost universal expectation for seamless experiences online, brands and retailers must push into experience-driven commerce territory to stand out. An emphasis on experience-driven commerce has not diminished the importance of factors like convenience, selection, search and price to shoppers. Rather, brands and retailers must master these capabilities to even earn shoppers’ consideration, and then go beyond them to differentiate from competitors.

Consumers go where they can receive the most seamless, memorable experience, not just the best price or delivery options. With standards for seamless transactions so high, content represents the key differentiator for brands and retailers to earn business.

Online shoppers may turn to popular marketplaces and retail giants for perks like low prices, but they appreciate how brands and retailers can offer memorable, educational content experiences. Personalised content experiences enable brands and retailers to really shine.

Regardless of where shoppers choose to engage a company, they should be able to trust the accuracy and completeness of the information they find. It’s clear that brands and retailers must approach content marketing with a clear strategy for scaling and delivering experiences that are relevant to shoppers’ personal needs.

Creating standout digital shopping experiences

While there has always been a natural uptick in how often people shop online, consumers’ digital habits have started to stabilise. Digital commerce will reach critical mass in 2019. This is according to Episerver’s “Reimagining Commerce” report, an in-depth look at the trends, tactics and technologies guiding brands and retailers in the age of experience-driven commerce.

In a survey of more than 4 500 global online shoppers, 26% of online consumers currently shop online at least weekly. This is just a small increase from last year’s report, which found that 23% of online consumers shop online at this frequency.

Bluegrass Digital CEO, Nick Durrant, points to the report and says the plateau effect in digital commerce leaves companies with a clear mandate to improve or get left behind. “The quality and diversity of digital commerce experiences play an even greater role in the struggle to stand out and earn customer loyalty.”

“To understand just how valuable innovative online shopping experiences are, consider today’s commerce environment. Leaders like Amazon have perfected seamless transactions, leaving fewer opportunities for differentiation via investments in this area,” he explains.

At the same time, traditional retailers are using technology to improve the customer experience and deliver new perks through sophisticated loyalty programs, bridging the online, in-store gap. The average shopper’s path to purchase is more complex than ever, filled with a wide variety of capabilities and attractions popularised by digital native brands.

Vying for consumers’ attention and wallet share will only grow more difficult as additional players enter the fray, further congesting an already crowded digital shopping ecosystem.

To get ahead, brands and retailers must implement dynamic, integrated content marketing and customer experience strategies that forge personal, emotional connections with shoppers beyond transactions.

Durrant says retailers need to look at the principles to achieve standout, experience-driven commerce that converts consumers into customers and buyers into brand advocates. “According to the survey, final purchases require guidance because only 20% of online consumers say all of their online purchases are pre-planned.”

Although seamless transactional experiences are the standard, online shoppers say the top three capabilities or features brands and retailers should support include free shipping, shipping tracking and information about returns.

“Even though 88% of online shoppers say it is the same or higher priority for brands and retailers to offer personalised experiences online in 2019 compared to 2018, 93% say it is the same or higher priority for companies to respect their anonymity online,” he adds.

It is also evident that digital commerce overwhelms consumers, nearly half of online shoppers have failed to complete a purchase online because there were too many options to choose from. Ten percent of online shoppers view an item five or more times before making an online purchase, adding to feelings of always-on commerce.

The survey also says ineffective content has major consequences: incorrect or incomplete content on a brand’s website or mobile app has stopped 98% of online shoppers from completing a purchase.

Social media has evolved into an established shopping channel, particularly for younger shoppers. Influencers are more important than ever  ̶  52% of online shoppers who use social media have clicked on an influencer’s post, according to the report, and a third of those shoppers (31%) have made a direct purchase from the post.

The report states that 21% of online shoppers aged 37 and under turn to social media for inspiration online when they do not have a product in mind for purchase, compared to just 5% of online shoppers aged 38 and older.

Durrant says according to the report, marketplaces are online shoppers’ top destination. “Online shoppers flock to marketplaces to start their online purchase journeys, whether they have a product in mind for purchase (46%) or not (39%).”

According to the report, voice-assisted shopping is most effective for repeat purchases. Voice is gradually becoming part of online shopping habits; more consumers are turning to voice for online shopping.

“Voice technology has also grown in popularity, 17% of online shoppers use voice devices to make purchases multiple times a month or more frequently, and 22% use the technology for research purposes in the same time frame,” he concludes.

The report, however, shows there is a preference for voice research over voice purchase. Brands and retailers should consider using voice to attract frequent shoppers for repeat purchases, while using traditional channels to build relationships with new customers or less frequent shoppers.

In conclusion, 43% of consumers cited a lack of security features as the number one reason they won’t make more purchases via voice-enabled devices. Difficulty searching for and comparing products were also cited as barriers to increased voice purchases.

About Bluegrass Digital (www.bluegrassdigital.com)

Bluegrass Digital is a leading provider of digital solutions for business. We simplify tech. We help you architect and build digital products and services, ensuring you transform and succeed in a digital world. With over 20 years of engineering experience and proven track record, Bluegrass Digital offers expert knowledge and its unique offering that is centred on service delivery excellence.

Canal Walk Shopping Centre launches social media brand campaign

Since their rise in popularity in the mid-20th century, shopping centres in this day and age tend to reflect the communities they serve; delivering on daily wants and needs, as well as acting as central meeting points for young and old. Understanding the social importance a shopping centre reserves within a community led Canal Walk Shopping Centre to launch its latest brand campaign, #CWSquad, spearheaded by three homegrown, Cape Town-based social media icons.

“Understanding our customer has always been of paramount importance to Canal Walk” explains Camilla Lor, regional marketing executive for Hyprop Investments Limited. “Being relevant to our customer within the societal context in which they live, work and play is key to our overall success, and so we turned to influential content creators within our very community to assist in delivering our brand message.”

Introducing the #CWSquad

The #CWSquad is made up of Nadia Jaftha, Aqeelah Harron Ally and Paula Lakay; three young ladies that will over the next year showcase the best Canal Walk has to offer across over 400 stores. When considering candidates for the campaign, it was important for Canal Walk’s marketing team that each squad member selected was not only already a friend of the brand, but also a greatly admired social media content creator offering their followers relevant and entertaining content.

“During the selection process, we naturally gravitated towards Jaftha, Harron Ally and Lakay because they effortlessly reflect who our customers are,” adds Lor. “From meeting friends for coffee and a catch up, doing a spot of wedding shopping, indulging in a shopping spree or two, grabbing a bite to eat or taking in a movie, Canal Walk has been part of these ladies’ lives every step of the way; as it has for so many of our customers.”

Over the next months, the #CWSquad will share with their followers everything from the season’s hottest lip colour, to where to find the best outfit for that special occasion, and anything and everything in between. “What makes the #CWSquad so impactful is not only are they respected and revered by their followers, but that they are genuine Canal Walk customers,” says Lor. “Customers no longer respond to disruptive, non-consumer centric content; they respond to recommendations from those they trust and admire.”

Meet the #CWSquad

Nadia Jaftha

Jaftha, known as the Content Queen by her fast-growing following, is always out and about creating hilarious pranking videos and relatable content. She has a charismatic, outgoing and vibrant personality, which captures her audiences on Instagram and YouTube.

Follow Nadia: Instagram | YouTube

Aqeelah Harron-Ally

The always elegant yet edgy Harron Ally is on the pulse of modest fashion styling and the latest beauty trends by means of her vlog. Along with her husband, Malick, she loves travelling the world and capturing their adventures. She is a total girl-boss, with a strong vision for her brand, Fashion Breed.

Follow Aqeelah: Instagram | YouTube

Paula Lakay

Most know her as Ms Paula Bee, through Instagram and her blog, but she recently got married to become Mrs Lakay. She is all about embracing and nurturing her gorgeous natural hair, as the Curl Queen, giving her followers beauty tips and tricks and capturing her life through vlogs.

Follow Paula: Instagram | YouTube

Plan of action

Month-by-month, Canal Walk will offer its shoppers a more in-depth look into each #CWSquad member’s life; highlighting their unique style by means of in-centre marketing touchpoints as well as via its direct marketing, and digital and social media platforms.

Canal Walk Shopping Centre is open from 09:00 to 21:00 seven days a week.

Social media and digital information for Canal Walk

Website www.canalwalk.co.za

CWSquad campaign information www.canalwalk.co.za/cwsquad

Facebook www.facebook.com/canalwalk

Instagram www.instagram.com/canalwalk

Twitter www.twitter.com/canal_walk

YouTube www.youtube.com/CanalWalkShopping

Hashtag #CWSquad

 

 

 

HomeChoice makes progress in difficult retail environment

HomeChoice International PLC, the leading participant in southern Africa’s retail homewares and financial services sectors to the expanding urban middle-income mass market, announced steady growth despite a tough second half for the year ended 31 December 2018. Revenue increased by 8,5%, and headline earnings per share remained largely unaltered from the previous year, at 507,7 cents. The group declared total dividends for the year of 194,0 cents per share, up 1,6%.

Chief executive officer South Africa, Shirley Maltz, commented: “Notwithstanding the challenging retail environment, we are seeing the benefit of our continuous investment into improving our customer experience and accelerating our digital transformation, which are both key strategic focus areas for the group. Credit extended via digital channels increased by 43,9% to R1,6 billion.”

Maltz expanded: “Another highlight for us is that the group continues to attract more than 20 000 new customers monthly, attracted by our curated product offers. The group’s active customer base increased by 10,0% this year.”

Capital expenditure, at R126 million, has increased notably in this period and has involved rolling out four additional showrooms and two ChoiceCollect containers, opening a second distribution centre in Gauteng to provide quicker, more convenient deliveries and re-platforming and upgrading technology across the business.

Financial results exhibit moderate growth and strong investment

Group revenue increased to R3,2 billion (2017: R3,0 billion), benefiting from a solid contribution from the financial services business, with loan disbursements up 21,5%. This was tempered by weaker retail sales of 6,3%.

Group EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 3,6% to R821 million. Despite significant cost focus, the group could not sufficiently mitigate weaker top-line growth in the second half of the year. Headline earnings increased by 1,3% to R529 million. The group declared a final dividend of 99 cents and a dividend cover of 2,6 times was maintained.

Retail disappoints in H2

Retail revenue increased by 7,4% to R2,5 billion. After a strong sales growth of 18,9% in H1, trading in the second half of the year was impacted by operational challenges at the South African Post Office (SAPO), with delays in the delivery of catalogues and parcels. The non-delivery of monthly catalogues had a substantial impact on sales. The group spent significant effort to assist SAPO and has also sped up the roll-out of showrooms and container hubs to provide additional channels for customers to collect their products. Increased marketing expenses to stimulate sales and additional courier charges to deliver the products to customers were incurred, translating into an EBITDA decrease of 2,9% to R453 million.

The business is however well-positioned to continue its strong historical performance in 2019. Digital sales contribution increased to 16% and will be further enabled with the launch of new e-commerce site. Supporting the much-loved HomeChoice private label, there are now 120 external retail brands on offer which provide variety to existing customers and attract new customers looking for quality homeware, fashion, furniture and personal electronics. The group has also had very positive customer response from the showrooms and ChoiceCollect, with further rollouts planned for 2019.

“Longer-term targets are for 20 showrooms and up to 100 ChoiceCollect containers across the country,” said Maltz.

Financial Services generates solid performance

Loan disbursements in the financial services business increased by 21,5% to R1,8 billion. Pleasingly, loans to existing customers increased to 84,5% of total disbursements, with strong acceptance of MobiMoney, our three-month, digital-only facility product. Revenue increased by 12,2% to R746 million and EBITDA grew by 13,7% to R357 million, highlighting the annuity aspect of the financial services business. Over 40 000 new customers were acquired during the year, increasing the base by 11,4% to 176 000.

Insurance has demonstrated strong growth in funeral products. Gross written premiums increased by 70% over 2017. “The opportunity remains to add more personal insurance products to the portfolio. This vertical represents an attractive growth opportunity to diversify income and increase customer share of wallet,” added Maltz.

At least 86% of customers are now registered on our digital platforms and a third of loan transactions concluded, are done outside of normal trading hours. The richer Mobi platform creates a portal for a multitude of products and value-added services to be offered to customers via their smartphones. The introduction of airtime, data bundles and electricity sales has indicated the potential opportunity to increase customers’ digital engagement with the group.

Stable credit

The group continued to expand a quality credit book with gross trade and loan receivables increasing by 7,5% (on an IFRS 9 comparable basis) to R3,5 billion. Group debtor costs at 17,2% of revenue was marginally above 16,8% in 2017, and remains within the group’s acceptable risk tolerances. Non-performing loans declined, while NPL cover was bolstered by increased provisions.  The improving performance metrics are testament to the group’s ongoing conservatism in managing its credit book.

Strong cash generation

Cash generated from operations increased by 32,0% to R474 million, driven by a decrease in retail credit growth in H2, good cash collections, a reduction in loan terms and actively managing cash requirements in working capital.

“The strong cash generation capability of the business is evidenced by the fact the group has managed to grow a credit book of more than R3,5 billion while maintaining a net debt to equity ratio (excluding property) of 22,2%,” Maltz said.

Outlook

“We will continue to position ourselves as a leading digital partner in the mass market, with an omni channel offering that provides an attractive and seamless retailing experience across all channels,” concluded Maltz.

The group has serviced this market for more than 30 years and has built up a loyal customer base of more than 870 000 active clients. This base, together with our established digital platforms, offer enormous opportunity to extend our product ranges and service offerings.

About HomeChoice International PLC

HomeChoice International plc is an investment holding company listed on the JSE Limited. The group provides retail and financial services to the mass market in southern Africa. HomeChoice services its large, primarily female and middle-income customer base through two trading operations, HomeChoice (Retail) and FinChoice (Financial Services).

 

Pick n Pay launches online distribution centre in Gauteng

Pick n Pay has just launched its online distribution centre in Gauteng, the first of its kind in the province. This follows the opening of its Cape Town online distribution centre, which made it the first major brick and mortar grocery retailer in South Africa to serve its online consumer customer base with a dedicated fulfilment centre.

Our new distribution centre will enable us to significantly improve service to our Gauteng online shoppers,” said Richard van Rensburg, Deputy CEO of Pick n Pay. “At the same time, our online distribution capacity is significantly increased, enabling us to handle the rapid growth we are experiencing in online sales.”

Evolving the online shopping experience through a multichannel approach

This distribution centre represents a significant investment in Pick n Pay’s online business, which is one of the fastest-growing divisions in our business, and represents a conviction by the company about the long-term opportunities from online,” said Van Rensburg.

It is the next step in our journey to build an advanced, convenient and simple omnichannel shopping experience for our clients. Later this year, we will launch a new online shopping website and an upgraded version of the Pick n Pay mobile app.”

Michael Cotterell, head of Pick n Pay Online, added: “We were encouraged by the performance of our dedicated online facility that was opened in Cape Town 18 months ago. We experienced a significant acceleration in sales growth after the facility went live, and we are confident our Gauteng customers will benefit from a similar facility.”

Advantages for the Gauteng online shopping customer

In the past, orders placed by Gauteng customers via Pick n Pay Online were fulfilled by a store close to the customer’s location. “There are significant advantages to serving customers with a dedicated facility instead of picking online orders from a store near to their delivery location,” said Cotterell.

Firstly, availability improves as online customers are not competing with customers in store for products. Secondly, freshness improves as the supply chain is shortened and the integrity of the cold chain is enhanced. Products move directly from our distribution centre to the customer and do not go via a store, thereby improving shelf-life for customers. Thirdly, we are able to significantly increase the range of products we offer to our customers. Our facility has the capacity to hold almost three times the number of product lines as a regular store. Our aim is to offer our online shoppers the widest range possible from Pick n Pay.”

Today’s online consumers want convenience, affordability and choice”, said Van Rensburg. “That’s what our new Gauteng fulfilment centre is able to give them.”

Virtual Reality, Chatbots to Dominate Brand Interactions by 2020

1280px-larry_ellison_ceo_of_oracle_corporation-970x646Virtual Reality, Chatbots to Dominate Brand Interactions by 2020

Johannesburg, 6 December 2016

 

Chantel Troskie, Customer Experience Account Manager at Oracle South Africa tells Shopping & Retail SA that more than three quarters of brands will deliver Customer Experience through VR and chatbots in the next four years. 
The relationship brands have with their customers is set to undergo a technological revolution causing the number of human-to-human interactions to fall significantly, according to new research released by Oracle today.

The Oracle report Can Virtual Experiences Replace Reality? polled 800 senior marketing and sales professionals across EMEA and revealed how the use of emerging technologies is set to surge by 2020.  Seventy-seven percent of brands expect to provide customer experiences through virtual reality in the next four years, while 79 percent expect to serve customers through chatbots.

chatbots-100687209-carousel-idgeHowever, despite this eagerness to embrace new technologies, many brands are still struggling to make use of the valuable customer and prospect data, with 56 percent not currently including social or CRM data in their customer analytics.

The changing customer dynamic
In South Africa, 77 percent of brands expect to be providing customer experiences through virtual reality and 79 percent will be serving customers through chatbots by 2020.

Most brands put this fundamental change in relationship down to the rise of social, digital and mobile platforms.

The research found that 43 percent of senior sales and marketing executives agree customers do more independent research before contacting them to make a sales enquiry, and 35 percent noted their customers preferred to make purchases or resolve a service issue without speaking directly with a member of the sales or customer service team.

VR and Chatbots set to surge
In response, brands are looking to implement innovative technologies that allow their customers to continue interacting with brands on their own terms.  In terms of upcoming technology investments, the research found:

77 percent of brands expect to be using VR for CX by 2020; 34 percent have already implemented the technology to some degree
79 percent of brands will be using chatbots for customer interactions by 2020; 30 percent have already implemented them
48 percent of brands have implemented automation technologies in sales, marketing and customer service, with another 38 percent planning to do so by 2020.

Data continues to pose a challenge
Despite the race to innovate, the reality is that many brands are still struggling to unify, organise and process the growing volumes of customer data they have coming into their business, making it difficult to truly understand and deliver a personalised experience for customers.

56 percent of brands don’t currently include social or CRM data in their customer analytics
48 percent agree smarter analysis of customer data will have the biggest impact on the experience they deliver to their customers
41 percent already collect a great deal of data from multiple sources, but are unable to extract customer insights from it

“For most organisations, the use of digital technologies has become the norm both inside and outside their walls. However, when it comes to VR there is a widespread perception that adoption will be slow due to high costs and because it will take some time before brands discover its relevant applications in their own business. Our research shows there is a strong appetite for VR, but it will be up to individual brands to tap into VR in a way that meets both their needs and those of their customers”, says Troskie.